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Currencies

China More and More Beyond ‘Inflation’

By |2022-04-11T20:13:16-04:00April 11th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

If only the rest of the world could have such problems. Chinese consumer prices were flat from February 2022 to March, even though gasoline and energy costs predictably skyrocketed. According to China’s NBS, gas was up 7.2% month-over-month while diesel costs on average gained 7.8%. Balancing those were the prices for main food staples, especially pork, the latter having declined [...]

What, When, Nominal, Forward, Yes, Oil; or, Spreads Everywhere

By |2022-04-11T18:36:12-04:00April 11th, 2022|Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

February 2005, Federal Reserve Chairman Alan Greenspan goes before Congress to tell the simple-minded politicians there about his “conundrum.” They and the media eat it up because somehow the guy was declared the “maestro.” Even so, he had a major problem and it was nothing more than LT Treasury yields doing what they do; that is, pricing less growth and [...]

Weekly Market Pulse: What Yield Curve Inversion

By |2022-04-11T05:52:45-04:00April 10th, 2022|Alhambra Portfolios, Bonds, Commodities, Currencies, Economy, Federal Reserve/Monetary Policy, Markets, Real Estate, Stocks|

Well, that didn't last long. I wrote last week about the inversion of the 10-year/2-year term spread as the yield of the 2-year Treasury note rose above the yield of the 10-year Treasury note. Using end-of-day data, the curve inverted on Friday, April 1st, and stayed that way until....Monday, April 4th. The spread closed last Friday, April 8th at 19 [...]

Concocting Inventory

By |2022-04-08T20:08:34-04:00April 8th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The Census Bureau provided some updated inventory estimates about wholesalers, including its annual benchmark revisions. As to the latter, not a whole lot was changed, a small downward revision right around the peak (early 2021) of the supply shock which is consistent with the GDP estimates for when inventory levels were shrinking fast. What’s worth noting about the figures now [...]

Speaking Volumes Rather Than Fast Rate Hikes

By |2022-04-08T17:39:41-04:00April 8th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The price illusion. It is causing enormous confusion and difficulty, making the global economy out to be something it really isn’t. In fact, the whole situation is being viewed backward. What’s presumed from this is a red-hot economy causing consumer prices to skyrocket. In such a scenario, central banks might need to rush their rate hikes to cool it down [...]

*Every* Time, Debt Ceiling Impacts Collateral Producing Inevitable Deflationary Currency

By |2022-04-07T20:15:34-04:00April 7th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Last September 28, Treasury Secretary Janet Yellen wrote to Nancy Pelosi of the House of Representatives to inform its Speaker that the government would run out of cash, and accounting tricks, by October 18. Unless Congress, starting in the House, did something about the so-called debt ceiling, Treasury would be forced to take even more restrictive, potentially destructive means to [...]

Goldilocks And The Three Central Banks

By |2022-04-06T20:12:02-04:00April 6th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

This isn’t going to be like the tale of Goldilocks, at least not how it’s usually told. There are three central banks, sure, call them bears if you wish, each pursuing a different set of fuzzy policies. One is clearly hot, the other quite cold, the final almost certainly won’t be “just right.” Rather, this one in the middle simply [...]

Treasuries, Sure, What About Other Government Bond Curves?

By |2022-04-05T19:53:14-04:00April 5th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

The US Treasury curve, as you might have heard, is inverted. After today’s repeat sell-off, it’s a little less inverted than it had been recently (un-inverted in the 2s10s, which isn’t unusual) given how yields closed at the longer end up more than those up front and middle. The zig-zag back and forth of ultra-short run market fluctuations continues.But what [...]

Worry Walls Don’t Explain Repeated Falls

By |2022-04-05T18:02:12-04:00April 5th, 2022|Bonds, Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

Someone once said that the stock market is always climbing a wall of worry. Maybe that had been true in some long-ago day, but whether or not it might nowadays is beside the point. The nugget of truth which makes the prosaism memorable is the wall rather than the climber. There’s always something going on somewhere to get worked up [...]

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